Determinants of inequality in Italy: An approach based on the Shapley decomposition

Inequality is a common concern, strongly perceived by people as well as by governments that redistribute resources through taxation and public expenditure. In order to design their redistributive policies, governments need information about the underlying factors explaining how resources are distributed and this paper addresses this topic. We propose an analysis of the inequality determinants in Italy using the Shapley value decomposition on pseudo-panel data and taking into account the geographical specificity of inequality.